BILL ANALYSIS
AJR 10
Page 1
Date of Hearing: May 6, 2009
ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL
SECURITY
Ed Hernandez, Chair
AJR 10 (Torlakson) - As Introduced: March 9, 2009
SUBJECT : Social Security: retirement benefits: public
employees.
SUMMARY : Requests the President and Congress of the United
States (U.S.) to repeal two offset deductions from the Social
Security Act that apply to teachers and other public employees
in the state. Specifically, this bill:
1)Requests that the Congress of the U.S. enact the Social
Security Fairness Act of 2009 which would repeal the
Government Pension Offset (GPO) and the Windfall Elimination
Provisions (WEP) from the Social Security Act.
2)Specifies that the Legislature of the State of California
requests President Barack Obama to sign that legislation.
3)Requires that the Secretary of the Senate transmit copies of
this resolution to the President and Vice President of the
U.S., to the Speaker of the House of Representatives, the
Majority Leader of the Senate, and each Senator and
Representative from California in the Congress of the U.S.
EXISTING FEDERAL LAW :
1)Contains the Social Security Act which includes two offsets,
the GPO and the WEP that reduce Social Security benefits
payable to persons who are entitled to benefits under other
public retirement systems.
2)The GPO provides that the Social Security benefits a person is
receiving as a spouse or surviving spouse are reduced by
two-thirds the amount of any government pension the person
receives based on his or her own work in Federal, State or
local government employment not covered by Social Security.
3)The WEP reduces the Social Security benefits of a retired or
disabled worker and the benefits of the worker's family if the
worker also receives a pension based in whole, or in part, on
AJR 10
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his or her own earnings based on noncovered employment.
FISCAL EFFECT : None.
COMMENTS : Social Security provides benefits to retired workers
and under certain circumstances, their spouses, former spouses,
surviving spouses and surviving former spouses. When Social
Security was originally established in 1935, state and local
governments and their employees were prohibited from
participating. Over the years, federal laws were passed
allowing these employees the opportunity to elect to join the
program and many California jurisdictions joined, including the
State of California, except for the California Highway Patrol,
firefighters and correctional officers. Other California public
employees not participating in Social Security include teachers,
more than 450 cities, counties and special districts, judges,
and those working for the University of California.
Nationwide, more than a third of all teachers are not covered
under Social Security. A majority of these teachers will be
subject to either the GPO or WEP, or in some cases, both. The
application of these provisions can have a severe impact on the
financial security of these retirees.
According to the author, "The WEP and GPO provisions of the
Social Security Act penalize individuals who move from private
sector employment to teaching, public safety, and other careers
in public service and vice versa. California has a significant
teacher shortage and requires more than 16,000 new teachers per
year to meet enrollment growth needs, retirement replacement, as
well as class size reduction in targeted schools.
"The penalty hamstrings the state's ability to recruit
experienced professionals to enter the teaching profession, as
they would lose their social security benefits if they changed
careers."
Numerous other resolutions have been adopted by the California
legislature in the past to encourage Congress and the President
to eliminate, or limit the application of, the Social Security
offsets. These include: AJR 5 (Hernandez, Resolution Chapter
116, Statutes of 2007, SJR 15 (Dutton), Resolution Chapter 62,
Statutes of 2006; AJR 29 (Pavely), Resolution Chapter 65,
Statutes of 2003; AJR 3 (Leonard), Resolution Chapter 66,
Statutes of 2001; and, SJR 4 (Soto), Resolution Chapter 94,
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Statutes of 2001.
REGISTERED SUPPORT / OPPOSITION :
Support
California Federation of Teachers (Co-sponsor)
California Retired Teachers Association (Co-sponsor)
California Teachers Association (Co-sponsor)
Association of California School Administrators
Association for Los Angeles Deputy Sheriffs
California Professional Firefighters
California School Employees Association
California State Employees Association
Faculty Association of California Community Colleges
Los Angeles County Probation Officers' Union, AFSCME, Local 685
Los Angeles Police Protective League
Orange County Employees Association
Orange County Professional Firefighters Association
Retired Public Employees Association
Riverside Sheriffs' Association
Opposition
None on file
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957